Covid-19: Job Retention Bonus

Details of the Coronavirus Job Retention Bonus were published on 31 July.  Under the JRB, employers can claim a one-off taxable sum of £1000 per employee previously furloughed under the Coronavirus Job Retention Scheme and still in employment on 31 January.  The aim of the scheme is to encourage employers to retain as many furloughed employees in meaningful employment as possible.  

Which employers are eligible?

All employers are eligible to participate in the scheme but they must ensure that they:

  • Have a UK bank account
  • Maintain enrolment for PAYE online
  • Comply with their obligations to pay and file PAYE accurately and on time under the RTI system.
Which employees can employers claim for?

The JRB is payable in respect of employees who:

  • were furloughed under the Coronavirus Job Retention Scheme
  • have been continuously employed from the most recent CJRS claim until 31 January 2021
  • were paid at least £520 per month on average between 1 November 2020 – 31 January 2021. 
How to claim?

Claims must be made online via a government website (yet to be opened) during February 2021.  Prior to submitting a claim, an employer must file their PAYE for January 2021.  JRBs will be paid out in February 2021.

How to make a successful JRB claim

By contrast with the fiendish complexity of the CJRS, the JRB appears straightforward.  However, there are a number of potential pitfalls for employers to avoid.

Ensure your CJRS claims are accurate. The government is very clear that CJRS claims must have been submitted accurately and any amendments (such as to correct accidental overpayments) notified to HMRC.  Unless this has been done, the JRB is unlikely to be paid.

Your records must be up to date. Payroll data must be current and accurate, and employers must address any requests from HMRC to confirm or provide employee data in respect of CJRS claims. Failure to do so may jeopardise a claim.

Ensure eligible employees receive earnings each month. Employees are only eligible if they receive a payment each month for the period November 2020 – January 2021.  Although payments will be averaged across the three months to ensure that a total of £1560 has been paid to the employee, there must be some earnings in each of those months.

Don’t issue notice too soon. JRBs will only be paid provided that the employee is not serving a notice period that began before 1 February 2021.  If notice is issued prior to this date, the employee will cease to be eligible for a JRB.